Tax and all that

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It was a Friday and Saturday of tax stories last week.

On Friday we were all supposedly going to have our bank accounts raided by HMRC, which is utter nonsense. 17,000 might a year, after maybe nine contacts with HMRC with whom, despite that, they are refusing to cooperate. Now I happen to think an ombudsperson is an essential control in this process, with that ombudsperson being empowered to take quick decisions to prevent sequestration when there is a genuine tax dispute going on for which a settlement precedent (such as an identical case being settled at tribunal) has not been created. That apart, this issue is a storm in a teacup. People refusing to pay their tax is not a victimless crime: we all have to pay if others don't and there is no doubt many refuse to do so, and that imposes considerable cost (including legal fees) on society.

As for the related fuss about money being taken from joint bank accounts, as I said on air many times on Friday the answer to anyone with concern on this issue is that if you know your partner has dodgy tax affairs don't share a bank account with them. For heaven's sake, either shop them as you should or at the very least (and if in doubt) act like a grown up in your own best interest and separate you cash. This is another non-event of an issue, in other words.

So let's move on to Take That having to pay millions in tax that they always owed. That is not a non-event. That was another welcome decision, like the Chris Moyles case, where a judge empowered by the new environment in tax (informed no doubt by the General Anti-Abuse Rule, inadequate as it is) has stood back and deemed a tax avoidance scheme non-commercial and that it therefore fails, not because of its legal construction but because the trade it supposedly supports simply does not exist. This common sense ruling, which a proper general anti-avoidance provision would have always prevented, is very welcome indeed. But what was absurd was that the press reported it as if members of Take That now had a tax bill of millions. That's not true: they always had that bill and now they have to pay it, and that's very good news for us all. The return of an OBE might constitute an apology, of sorts.

For once HMRC almost had a good week. Such a shame then that on Saturday a whistleblower pointed out in the Times that the organisation is rapidly falling apart due to understaffing. It did nit take long for reality to hit home again, pretty hard.